The poor financial performances by the pharma majors, warning letters. from US FDA, adverse exchange rate fluctuations, price cuts and growing competition impacted the investors. sentiments and BSE Healthcare (BSE HC)index of 68 companies declined by 3.6 per cent to 14,190.58 points on the last trading day of June 2017 from December 2016 closing of 14,727.59. Further, implementation of GST may put additional burden in the second half of 2017. The overall investors confidence in other sectors improved during the period and BSE Sensex improved by 16.1 per cent and closed at 30,921.61 points on June 30, 2017 as against closing of 26626.46 points at the end of December 2016.
The BSE HC index reached at peak level at 15,612.02 point on March 17, 2017 and lowest at 13,073.42 points on May 29. 2017. Sensex reached to highest level at 31,522.87 on June 22, 2017 and touched at its lowest level at 26,447.06 on January 1, 2017.
Major shares like Ajanta Pharma, Alembic Pharma, Divi's Laboratories, Dr Reddy's Laboratories (DRL), FDC, Glenmark Pharmaceutical, Indoco Remedies, J B Chemicals, Lupin, RPG Life, Sun Pharmaceutical, Syngene, etc declined by over 10 per cent during the first half ended June 2017. DRL share declined sharply by 11.9 per cent to Rs.2,688.50 on June 30, 2017 from Rs.3,052 as at the end of December 2016 on account of US FDA warning letters. Similarly, Divi's Labs scrip knocked down by 17.4 per cent to Rs.646.85 from Rs.783.10 during first half. Lupin declined by 28.6 per cent to Rs.1,069 from Rs.1,483.70.
However, few shares, like Cadila Healthcare, Granules India, Kopran, Natco Pharma, Neuland Laboratories, Piramal Enterprises and Vivimed Labs moved up significantly.
Out of Pharmabiz sample of major 32 companies, net sales of five companies viz. DRL, Torrent Pharma, Wockhardt, Alembic Pharma and Pfizer declined during 2016-17 and 15 major companies including Sun Pharma, Aurobindo Pharma, Cipla registered sales growth of single digit only. However, Lupin Glenmark Pharma, Piramal Healthcare, Alkem Labs, Biocon, Strides Shasun, Ipca Laboratories, Abbott India, Natco Pharma, Ajanta Pharma Unichem Laboratories and J B Chemicals and Pharma registered double digit growth in sales. Natco Pharma achieved strong sales growth of 91.2 per cent to Rs.2,065 crore during 2016-17 from Rs.1,080 crore in the previous year.
For the first half ended June 2017, the US FDA approved total 387 ANDAs and out of this, Indian companies and their subsidiaries secured 138 approvals with the help of higher R&D expenditure during last couple of years. Further, out of 85 tentative approvals, Indian companies grabbed 32 tentative approvals from US FDA during first half. Aurobindo Pharma received highest number of approvals of 30 ANDAs during January-June 2017 and was followed by Zydus Pharma 21 ANDAs. Lupin and Gland Pharma received 9 approvals each and Taro Pharma and Sun Pharma also got nine approvals. Three companies, Alkem Laboratories, Glenmark Pharma, and Alembic Pharma received 6 approvals each. Thus, Indian companies set to intensify their presences in global market in the next half of 2017.